UK lending misses expectations
The Bank of England released three key pieces of data this morning, and it's not looking good.
First, consumer credit was £489m in June, the smallest rise since January, and down from an upwardly revised £781m in May. Economists had expected to see net growth of £700m.
Meanwhile, mortgage approvals fell unexpectedly to 57,667, after hitting its highest point since December 2009 in May. Economists had expected another record rise to 60,000. Of course, approvals were still at the third highest level since December 2009, up 21.5 per cent year-on-year, and around 7,500 higher than it was in April this year.
Finally, net mortgage lending to individuals more than doubled to £981m in June from £466m the month before, but economists will be disappointed, having expected it to hit £1.4bn.
Miss on UK mortgage numbers not surprising given uptick in LT rates: UK Gilt 30Y yield +9.92% in June, from 3.265% to 3.589%. Now 3.531%.
— Christopher Vecchio (@CVecchioFX) July 29, 2013
It's worth noting too that net lending to small and medium sized businesses rose by £238m – compared with an average monthly fall of half a billion pounds over the past six months. However lending to non-financial businesses overall shrank by a net £1.3bn.